A new replication-defective, acute transforming retrovirus (3611-MSV) was recently isolated from mice and was molecularly cloned. Two gag-containing polyproteins (P75 and P90) are found in nonproducer transformed cells. The nucleotide sequence of 1.5 kilobases encompassing the transforming gene (v-raf) of 3611-MSV has been determined. v-raf sequences were found to have been inserted into the p30 region of an ecotropic murine leukemia virus (MuLV) with the concomitant deletion of the 2.4 kilobases extending to the middle of the polymerase gene. A 5-nucleotide direct repeat exists at each end of the v-raf sequences. From the deduced amino acid sequence, a hybrid gag-raf polyprotein would have a molecular weight of approximately 75 kilodaltons. Consistent with the gag-x structure, we found that only the P75 polyprotein is modified by the fatty acid myristate, whereas only the P90 polyprotein is glycosylated. Comparison of the deduced v-raf amino acid sequence with other oncogenes revealed domains homologous to the src family of oncogenes. The phylogenetic organization of this family determined from the predicted amino acid sequences suggests that the raf oncogene evolved prior to those members which exhibit tyrosine-specific phosphorylating activity. The Drosophila and yeast raf homologs have been recognized and the former has been cloned. In situ hybridization to Drosophila polytene chromosomes localizes the raf homolog (D-raf-1) to position 2F on the X chromosome. Analysis of developmentally staged Drosophila RNAs reveals the D-raf-1 sequence is expressed only in 12-20 hour embryos. Both humans and mice express raf RNA in specific tissues in the form of mRNAs of approximately 3.5 kb and 3.3 kb, respectively. A human fetal liver cDNA library has been the source of several raf-specific clones recently characterized. c-raf-related sequences have been localized to human chromosome 3, a chromosome whose alterations are associated with small cell lung carcinoma and other familiar carcinomas. Human cells derived from small cell carcinomas express v-raf-specific RNA, as do some other established human lung carcinoma cell lines.